cobra

bruth

if an employee is in a cafeteria plan, paying for her own health insurance, not a group plan, when she is terminated, does the employer have to send out cobra notification?

irenesmsaclaims

There are no COBRA rights with an individual health plan paid for by the employee, with no employer involvement. There are COBRA rights, however, with the FSA (health spending part of the cafeteria plan) and COBRA must be offered for that.

bruth

Thank you so much. So as I understand, even if the employer is paying the employee X dollars per month for use in any selected benefit, if they select health insurance and pay their own premium, COBRA notices must be sent at termination. If so, then does the employee simply continue to pay the health insurance premium on their own, or do they then need to pay the premium to the employer and the employer then must forward the payment to the insurer? Again, thank you so much for your reply - this is an invaluable resource.

irenesmsaclaims

The COBRA offer would be for the medical spending in the cafeteria plan, not for the individual health policy, if in fact the employee is the one maintaining the coverage. It can get tricky if the employer is involved in the policy, and could be construed as being an employee benefit, and all that that implies. Are there payroll deductions for the medical spending election, and the employee is being reimbursed to pay the premiums, or is the employer paying the premiums? Or, are you referring to a cash option in the cafeteria plan?